What is the fixed cost? $[ What are the Variable Costs? $[ If the merchandise is very popular among students and they need 2,000 units, what do you predict it would cost, based on the ove calculations? $ If the College of Engineering were to receive an offer from a different producer for a flat rate of $22 per shirt, what would be the eakeven point between the two scenarios? $[
What is the fixed cost? $[ What are the Variable Costs? $[ If the merchandise is very popular among students and they need 2,000 units, what do you predict it would cost, based on the ove calculations? $ If the College of Engineering were to receive an offer from a different producer for a flat rate of $22 per shirt, what would be the eakeven point between the two scenarios? $[
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter8: Cost Analysis
Section: Chapter Questions
Problem 9E
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Transcribed Image Text:Suppose the College of Engineering is planning to sell merchandise this year. They don't know how many students will be interested
or how many will sell, so they've received three quotes for orders of different sizes. Assume the relationship is linear or best fit.
Cost Quote
Units
Small Order
Medium Order
Large Order
Extra Large Order
220
445
900
1500
a) What is the fixed cost? $
b) What are the Variable Costs? $
$5,000
$10,000
$18,900
$24,000
c) If the merchandise is very popular among students and they need 2,000 units, what do you predict it would cost, based on the
above calculations? $
d) If the College of Engineering were to receive an offer from a different producer for a flat rate of $22 per shirt, what would be the
breakeven point between the two scenarios? $
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